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Predictive Analytics

4 Ways How Predictive Analysis and Recommendation Systems Can be Used to Increase Sales

Recommendation systems are only as good as the recommendations they make. Using predictive analysis to aid your inventory listings will lead to satisfied customers and, in the end, drive sales. Here are four ways how to use both in conjunction to increase sales.


Recommendation systems are not just judged by the speed of the output of recommendations; they are also judged by how relevant these suggestions are. Predictive analytics platform blog Custora reports “[s]earch (free and paid) is still the primary driver of online shopping, with over 40% of e-commerce orders originating on Organic Search (26%) and Paid Search / SEM (15%)”. This means that a customer shopping online at Walmart might buy Babybel cheese but they may not be receptive to unwarranted suggestions for baby clothes rather than other types of cheese.

Making relevant suggestions to customers before they need them – and doing it correctly – is a great benefit of utilizing a recommendation system that will drive your sales. You do not have to be the size of Walmart to compete effectively against them. By optimizing the recommendations your website displays to customers and visitors in real-time, you can help them purchase items they had forgotten they needed and remind them of your marketplace’s utility and efficiency. Satisfied customers become return customers, especially when they like the items they see suggested to them.


While customers may enjoy more relevant suggestions for items, you can also analyze which items sell well and which do not, which months are better to sell certain items, and the types of customers who purchase each item, etc. Such analytics will help you, as a business owner and operator of an online marketplace, to tweak the item selection available to customers and increase sales. With a stronger, smaller inventory, customers will be able to shop more efficiently.

You can also use your customer analytics to predict and prevent losses. According to “10 Rules for Supply Chain & Logistics Optimization,” published by the Georgia Institute of Technology’s H. Donald Ratliff, Ph.D, “[f]or most supply chain and logistics operations there is an opportunity to reduce cost by 10% to 40% by making better decisions.” For example, if a particular item only sells well during the winter season, consider selling it only in the summer. By removing and re-introducing items (in a sale or discount) that do not sell particularly well, you can boost the efficiency of your recommendation system and move items in a more dynamic fashion.


The customer experience is an important one; one which many business owners take for granted. They believe that because they are pleased with their own products and selection the customer will be as well. However, customers in online shops have a different experience than the business owner and come at it with new eyes. Customers do not like being overwhelmed with advertisements, and they must be able to navigate your website and online shop with ease or they will become frustrated and leave for a competitor. Customers hate messy websites, as reported by Pando Media Inc.

Many business owners think that big, flashy animations, large banner advertisements, and popups prompting customers for contact forms will increase conversions, but this is not true. Your website should be enhancing the customer experience by only making timely and relevant suggestions to the customer, based on their purchase history and page views. Keep the design of your website simple yet elegant. The only major interactive part of your website and online shop should be the recommendation system.


Many small and medium business owners believe they are doing everything they can to increase sales, but more can always be done. Using a recommendation system to make nuanced suggestions of related products based on their page views and previous purchases allows customers to find other items they may not have consciously considered. Even if a customer does not purchase additional items in a single session, there’s a good chance they will return to your website based on the helpfulness of the recommendations they received.

Return customers are important because their contributions to your sales numbers are exponential. Instead of trying to gain new customers and clients, it’s better to please the ones you already have and turn them into loyal return customers. As stated by Werner Reinartz in the Harvard Business Review: Fenwick, a French forklift truck manufacturer started using predictive analysis to offer more services to their customers based on their behavior, a decision which has resulted in “50% of its €500 million in revenues comes from services developed over the past fifteen years.” Using a recommendation system to display relevant items allows customers to learn more about your inventory, which will lead to increased sales over time.

This Post Has One Comment

  1. eebest8

    “Thanks so much for the article.Really thank you! Really Great.”

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